The Income Tax Department has issued an official order dated 21st July, 2021 that mandates that ten investigative and intelligence agencies, including the CBI and NIA, receive PAN and bank account details of any entity. Under the integrated counterterrorism platform NATGRID, this will be done. Lets know more about PAN number privacy.
Importance of PAN Card
A PAN or Permanent Account Number is an important document all taxpayers must possess, as mandated in the Income Tax Act of 1961. It is the tax identity for any individual or business that is generating income. The main objective of a PAN is to track and prevent tax evasion.
If you do not have a PAN, the Income Tax Department may consider you to be concealing important information related to your financial transactions from them. Also, without a PAN, you cannot benefit from the tax benefits offered by the government and will be liable to pay taxes at the highest rate. Hence, it’s high time you apply for a PAN card if you have not got one so far.
Is It Safe to Share Pan Card Details?
With this importance of PAN cards, there comes one threat as well. PAN Card is required almost everywhere. We tend to leave our PAN card copies in multiple places, without even thinking twice. As a business, you also share your PAN numbers with consultancies and other third-party vendors. Wake up! It’s just about the time for you to be careful with your PAN. A lot of reports have been received of late about the misuse of PAN numbers. The Income Tax Department has also issued warnings to all PAN cardholders in the country to be careful while sharing their PAN details.
If you share your PAN details casually, you make yourself vulnerable to identity theft. Miscreants may make fake transactions in your name, keeping you completely in the dark about it. Invariably, PAN is linked to other documents such as Aadhaar card, passport, and bank accounts. If any miscreant can catch hold of your PAN number, he can have access to these documents/information as well.
Is It Safe to Give a Pan Card Number Online?
In today’s world, online transactions are the ‘order of the day’. We all use a PAN card copy to book railway or flight tickets online. Some other online transactions also ask for the PAN card copy of the PAN number. The increasing use of PAN has also increased the possibility of identity theft of PAN cards. Safeguarding the physical copy of the PAN card no longer prevents the misuse of your PAN card. Miscreants can extract your PAN card number or Benami property deals or other high-value purchases.
Can Anyone Misuse My Pan Card Number?
Yes. If you leave your PAN card number on the public domain, it becomes vulnerable to misuse. One such misuse of PAN cards has been revealed recently by a consumer activist group. Several jewelers were found to misuse PAN card information provided by travelers for the Tatkal booking of railway tickets. These jewelers used to steal PAN card information available in the Indian Railway Ticket Reservation system. Then they used the tax details attached to these PAN cards while selling high-value jewelry to individuals/parties who did not wish to reveal their PAN details in these transactions.
This type of misuse can put you into all sorts of troubles. If your PAN card is misused in this manner, you will not be even aware of this for quite some time. If you are a taxpayer, you will get to know about such transactions when you go through Form 26 AS. This form will give you a consolidated report of all transactions with the deduction of tax thereof. If you do not pay tax, then you may be completely dark about these transactions.
During the annual tax audit, the Income Tax Department may spot these high-value transactions attached to your PAN card. They may approach you to ask if you carried out those transactions. In this case, you will need to provide all sorts of justifications to convince them. This will be a painstaking sequence of events for you. Therefore, you should take proper care while disclosing your PAN card details to anyone. In case you need to provide PAN card copies to make any online transaction, always hand over signed photocopies to avoid trouble in the future.
How to Protect Your Pan Card From Identity Theft
Don’t be under the illusion that sharing a pan card number is always safe. It’s better to be cautious than to repent later on. Here are some tips to protect your PAN card from identity thefts
- Do not use your PAN card for any casual transaction, unless specified
- Do not share your PAN details with others, apart from your immediate family members
- Be sure about why and where you are using your PAN details
- In case, you need to provide PAN card copies to make any online transaction, always hand over signed photocopies. Also, mention the date of use.
- Also, keep a photocopy of all the accompanying documents you are submitting along with your PAN card.
As a result, it is always advisable that you take care when sharing sensitive data, and PAN card is among those sensitive data. You have to share your PAN if you want to file your tax with a CA consultancy firm. In that case, you can follow the safety guidelines outlined in this article. Do not share anything and no matter who you share it with.